Richardson Greenshields of Canada (Pacific) Ltd v. Tze Yim

HCA006690B/1987

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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BETWEEN

AND BETWEEN

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Coram: The Hon. Mr. Justice Kaplan in Chambers

Date of Hearing: 25 April 1991

Date of Judgment: 25 April 1991

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JUDGMENT

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1. On 25th April 1991 I heard the defendant's application that the hearing fixed for 25 days commencing on 25th June 1991 be vacated. I refused this application and said that I would give my reasons as soon as possible.

2. It appears that the defendant was a victim of the October 1987 stock market crash in a most unfortunately spectacular manner. Prior to the crash, the plaintiff held HK$250M worth of shares on behalf of the defendant. After the crash, they liquidated his account and now claim HK$65M as the balance due to them. This sum with interest now approaches HK$85M. The defendant raises a number of defences, but principally, his complaint is that on the 27 October 1987 the plaintiff sold his shares by private sale to Mr. LI Ka-shing or a company called Penkilan Limited at less than the market price. A long chronology has been placed before me, but the principal dates appear to be as follows.

The writ was issued on 3rd November 1987.

The statement of claim was served on 12th December 1987.

The first of many defences were served on 2nd December 1987.

The defence was immediately amended on 5th December 1987.

The action then took a normal course. during 1988 and the first half of 1989 including two further amendments to the defence.

On 15th June 1989, Sears, J. made by consent a somewhat unusual discovery order which unfortunately led to dispute in 1990.

In late 1989, the defendant applied to Bokhary, J. to strike out the claim and non-compliance with the consent discovery order. Bokhary, J. refused to strike out. The defendant appealed and this was dismissed on 12th December 1990.

3. On 20th September 1990, Judge Leonard, sitting as a Deputy High Court Judge, gave the plaintiff leave to set the action down for a hearing to commence not before June 1991.

4. On 16th October 1990, Mr. Registrar Betts fixed the present trial date.

5. On 9th November 1990, Nazareth, J. gave the defendant leave to amend his defence yet again.

6. On 22nd November 1990, the defendant served a fresh defence and counterclaim.

7. On 4th June 1991, Mr. LI and Penkilan who became 3rd and 4th defendants by counterclaim served their defence and counterclaim.

8. On 28th January 1991, the defendants requested leave to admit Mr. Peter Leaver, Q.C. and this was refused.

9. On 7th February 1991, the defendant changed his solicitors due to the departure into commerce of a gentleman who had previously dealt with his case.

10. Numerous summonses were issued mainly by the defendant dealing with particulars and interrogatories, and I heard argument on these on the 23rd-25th April 1991.

11. The defendant also took out a summons requesting that the evidence of Mr. Au be taken in Canada and that the action be stayed until that had been done.

12. I should have added that for some time the defendant had the advantage to be represented by Mr. Francis Eddis, Q.C. who unfortunately passed away in February 1991.

13. Mr. Chain who appears for the defendant submitted that there was no way in which the defendant could be ready for trial on the 25th June. He relied on the outstanding interrogatories and particulars. As to Mr. Au, although Mr. Thomas for the plaintiff indicated that Mr. Au was ready, willing and able to be examined in Canada as soon as this could be arranged, nevertheless Mr. Chain submitted that this would inevitably cause some delay and disruption to the preparation for trial.

14. Mr. Thomas pointed out that the application was originally based on the delay which would be caused if I ordered an examination on Mr. Au in Canada. That no longer existed because Mr. Au is prepared to co-operate and there is no reason why this cannot be done very quickly if the defendant still insists upon cross-examining Mr. Au.

15. If it should transpire that Mr. Thomas' instructions about the ready availability of Mr. AU are not correct, then the defendant will be free to renew his application to adjourn.

16. The second limb to the application as foreshadowed by the defendant's solicitor's affidavit in support was that Mr. Li and Penkilan were not prepared to go ahead with a June trial.

17. Clearly, it is sensible for the counterclaim to be heard at the same time as the claim, but fortunately Mr. Li and Penkilan now feel able to be ready by June and so this part of the application falls away.

18. The plaintiff's position is that they are owed about HK$85M and it is now getting on for four years since the claim arose. Mr. Chain conceded that if the case was adjourned it was unlikely to come on before February 1992. This delay was unacceptable for the plaintiff.

19. Mr. Thomas submitted that no good cause had been shown as to why the June dates could not be kept. Mr. Ma for Mr. Li and Penkilan were also anxious to keep these dates. Serious allegations were being made against them and they wanted their opportunity to show that these allegations were groundless. Mr. Thomas also made the point that there are still nine weeks to go before the 25th June, and he submitted that a lot of preparation work can be done during that period.

20. Mr. Chain asked me to approach the matter neutrally, in other words, not to impose on him any particular burden because the defendant did oppose the order of Judge Leonard in September 1990. He points out that the change of solicitors in February and the death of Mr. Eddis also in February were not his client's fault. He submitted that the defendant would have a grievance if the matter was not adjourned.

21. In applications of this nature which are never easy, it is necessary to balance the competing interests of both sides. The plaintiffs say they are owed a lot of money and wish to have their day in court. The defendant is, of course, anxious to be as well prepared as possible and does not want a trial until every conceivable avenue has been explored. I must say that, as will become apparent from my judgment on the interrogatories and particulars, the defendant is casting his net very wide and, at times, it seems to be somewhat wide of the mark.

22. The defendant is clearly suspicious and one can imagine how he feels at having lost the whole or part of his fortune in a matter of minutes during panic selling. But at the end of the day the issue boils down to whether the sale of the defendant's shares by the plaintiff was authorised and whether the sale to Mr. Li or Penkilan was at a reasonable price or was below such price as a result of favours shown to Mr. Li. Many of the interrogatories and particulars are fishing for material. If the defendant kept his eye on the main point, he may not have so much trouble in preparing for trial. There has to be a trial and it cannot be put off indefinitely.

23. The plaintiff's legal team is reserved and ready for the June hearing. The same applies to Mr. Li's legal team. Mr. Chain tells me that he is not briefed yet and no leader has been instructed. If I adjourn the matter it may well be that Mr. Thomas, Mr. Ma and his leader may not all be able to agree dates for some considerable time.

24. I am, of course, very anxious to ensure that the defendant has sufficient time to prepare for trial. I believe that there is just sufficient time for him to do that. I have taken into account the proximity of the hearing dates when considering the interrogatories and particulars. In refusing the application, I made it clear that if the defendant can produce more cogent reasons for an adjournment at a later date, I will, of course, consider them. However I can only deal with the application on the basis of the material now before me. I do not consider that it justifies adjourning the dates when balancing the interests of all parties.

25. I make it clear that so far as is possible. I will hear all further interlocutory applications as quickly as possible. I have already made it clear that my mind is not shut on the question of an adjournment if the defendant can bring before me more cogent reasons than he has thus far.

26. I order the defendant to pay the costs of this summons of the plaintiff and the 3rd and 4th defendants to counterclaim. I decline to order a certificate for two counsel for the plaintiff.

Representation:

Mr. M. Thomas, Q.C. and Mr. C. Smith instructed by Simmons & Simmons for the Plaintiff.

Mr. Benjamin Chain instructed by K.C. Ho & Fong for the Defendant.

Mr. Geoffrey Ma instructed by Woo, Kwan, Lee & Lo for the 3rd & 4th Defendants by counterclaim.